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THIRD DIVISION

DEL PILAR ACADEMY, EDUARDO ESPEJO and ELISEO OCAMPO,


JR.,

Petitioners,

- versus -

DEL PILAR ACADEMY EMPLOYEES UNION,

Respondent.

G.R. No. 170112

Present:

YNARES-SANTIAGO, J.,

Chairperson,

AUSTRIA-MARTINEZ,

CHICO-NAZARIO,
NACHURA, and

REYES, JJ.

Promulgated:

April 30, 2008

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DECISION

NACHURA, J.:

Before this Court is a petition for review on certiorari


assailing the July 19, 2005 Decision[1] of the Court of Appeals
(CA) in CA-G.R. SP. No. 86868, and its September 28, 2005
Resolution[2] denying the motion for reconsideration.

Following are the factual antecedents.


Respondent Del Pilar Academy Employees Union (the UNION) is
the certified collective bargaining representative of teaching
and non-teaching personnel of petitioner Del Pilar Academy
(DEL PILAR), an educational institution operating in Imus,
Cavite.

On September 15, 1994, the UNION and DEL PILAR entered


into a Collective Bargaining Agreement (CBA)[3] granting
salary increase and other benefits to the teaching and non-
teaching staff. Among the salient provisions of the CBA are:

ARTICLE V

SALARY INCREASE

SECTION 1. Basic Pay – the ACADEMY and the UNION agreed to


maintain the wage increase in absolute amount as
programmed in the computation prepared by the ACADEMY
and dated 30 June 1994 initialed by the members of the
bargaining panel of both parties, taking into account increases
in tuition fees, if any.

SECTION 2. The teaching load of teachers shall only


be Twenty-Three (23) hours per week effective this school year
and any excess thereon shall be considered as overload with
pay.

SECTION 3. Overloadpay (sic) will be based on the


Teachers’ Basic Monthly Rate.
SECTION 4. The ACADEMY agrees to grant longevity
pay as follows: P100.00 for every 5 years of continuous
service. The longevity shall be integrated in the basic salary
within three (3) years from the effectivity of this agreement.

ARTICLE VI

VACATION LEAVE WITH PAY

SECTION 1. Every faculty member who has rendered


at least six (6) consecutive academic semester of service shall
be entitled to the 11th month and 12th month pay as summer
vacation leave with pay. They may, however, be required to
report [and] undergo briefings or seminars in connection with
their teaching assignments for the ensuing school year.

SECTION 2. Non-teaching employees who shall have


rendered at least one (1) year of service shall be entitled to
fifteen days leave with pay.

The UNION then assessed agency fees from non-union


employees, and requested DEL PILAR to deduct said
assessment from the employees’ salaries and wages. DEL
PILAR, however, refused to effect deductions claiming that the
non-union employees were not amenable to it.

In September 1997, the UNION negotiated for the renewal of


the CBA. DEL PILAR, however, refused to renew the same
unless the provision regarding entitlement to two (2) months
summer vacation leave with pay will be amended by limiting
the same to teachers, who have rendered at least three (3)
consecutive academic years of satisfactory service. The
UNION objected to the proposal claiming diminution of
benefits. DEL PILAR refused to sign the CBA, resulting in a
deadlock. The UNION requested DEL PILAR to submit the case
for voluntary arbitration, but the latter allegedly refused,
prompting the UNION to file a case for unfair labor practice
with the Labor Arbiter against DEL PILAR; Eduardo Espejo, its
president; and Eliseo Ocampo, Jr., chairman of the Board of
Trustees.

Traversing the complaint, DEL PILAR denied committing unfair


labor practices against the UNION. It justified the non-
deduction of the agency fees by the absence of individual
check off authorization from the non-union employees. As
regards the proposal to amend the provision on summer
vacation leave with pay, DEL PILAR alleged that the proposal
cannot be considered unfair for it was done to make the
provision of the CBA conformable to the DECS’ Manual of
Regulations for Private Schools.[4]

On October 2, 1998, Labor Arbiter Nieves V. De Castro


rendered a Decision, viz.:

Reviewing the records of this case and the law relative to the
issues at hand, we came to the conclusion that it was an error
on [the] part of [DEL PILAR] not to have collected agency fee
due other workers who are non-union members but are
included in the bargaining unit being represented by [the
UNION]. True enough as was correctly quoted by [the UNION]
Art. 248, to wit:

Employees of an appropriate collective bargaining unit who are


not members of the recognized collective bargaining agency
may be assessed a reasonable fee equivalent to the dues and
other fees paid by members of the recognized collective
bargaining agreement: Provided, that the individual
authorization required under Article [241], paragraph (o) of this
Code shall not apply to the non-members of the recognized
collective bargaining agent.
As it is, [DEL PILAR’s] unwarranted fear re-individual dues
[without] authorization for non-union members has no basis in
fact or in law. For receipt of CBA benefits brought about by the
CBA negotiated with [petitioners], they are duty bound to pay
agency fees which may lawfully be deducted sans individual
check-off authorization. Being [recipients] of said benefits,
they should share and be made to pay the same
considerations imposed upon the union members. [DEL
PILAR], therefore, was in error in refusing to deduct
corresponding agency fees which lawfully belongs to the union.

Anent the proposal to decrease the coverage of the 11th and


12th month vacation with pay, we do not believe that such was
done in bad faith but rather in an honest attempt to make
perfect procession following the DECS’ Manuals. Moreso, it is
of judicial notice that in the course of negotiation, almost all
provisions are up for grabs, amendments or change. This is
something normal in the course of a negotiation and does not
necessarily connote bad faith as each every one (sic) has the
right to negotiate reward or totally amend the provisions of the
contract/agreement.

All told while there was error on [the] part of [DEL PILAR] for
the first issue, [it] came through in the second. But as it is, we
do not believe that a finding of unfair labor practice can be had
considering the lack of evidence on record that said acts were
done to undermine the union or stifle the member’s right to
self organization or that the [petitioners] were in bad faith. If
at all, it’s (sic) error may have been the result of a mistaken
notion that individual check-off authorization is needed for it to
be able to validly and legally deduct assessment especially
after individual[s] concerned registered their objection. On the
other hand, it is not error to negotiate for a better term in the
CBA. So long as [the] parties will agree. It must be noted that
a CBA is a contract between labor and management and is not
simply a litany of benefits for labor. Moreso, for unfair labor
practice to prosper, there must be a clear showing of acts
aimed at stifling the worker’s right to self-organization. Mere
allegations and mistake notions would not suffice.
ACCORDINGLY, premises considered, the charge of unfair labor
practice is hereby Dismissed for want of basis.

SO ORDERED.[5]

On appeal, the National Labor Relations Commission (NLRC)


affirmed the Arbiter’s ruling. In gist, it upheld the UNION’s right
to agency fee, but did not consider DEL PILAR’s failure to
deduct the same an unfair labor practice.[6]

The UNION’s motion for reconsideration having been


denied,[7] it then went to the CA via certiorari. On July 19,
2005, the CA rendered the assailed decision, affirming with
modification the resolutions of the NLRC. Like the Arbiter and
the NLRC, the CA upheld the UNION’s right to collect agency
fees from non-union employees, but did not adjudge DEL PILAR
liable for unfair labor practice. However, it ordered DEL PILAR
to deduct agency fees from the salaries of non-union
employees.

The dispositive portion of the CA Decision reads:

WHEREFORE, premises considered, the petition is PARTIALLY


GRANTED. The assailed resolution of the NLRC dated April 30,
2004 is hereby MODIFIED. Private respondent Del Pilar
Academy is ordered to deduct the agency fees from non-union
members who are recipients of the collective bargaining
agreement benefits. The

agency fees shall be equivalent to the dues and other fees


paid by the union members.
SO ORDERED.[8]

DEL PILAR filed a motion for reconsideration of the decision,


but the CA denied the same on September 28, 2005.[9]

Before us, DEL PILAR impugns the CA Decision on the following


grounds:

I. IN PROMULGATING THE CHALLENGED DECISION


AND RESOLUTION, THE HON. COURT OF APPEALS
DISREGARDED THE FACT THAT THE ANNUAL INCREASE IN THE
SALARIES OF THE EMPLOYEES WAS NOT A BENEFIT ARISING
FROM A COLLECTIVE BARGAINING AGREEMENT, BUT WAS
MANDATED BY THE DIRECTIVE OF A GOVERNMENTAL
DEPARTMENT; and

II. CONSIDERING THE ANNUAL SALARY INCREASE OF


NON-UNION MEMBERS WAS NOT A BENEFIT ARISING FROM THE
CBA, THEIR INDIVIDUAL WRITTEN AUTHORIZATIONS ARE STILL
REQUIRED TO ALLOW PETITIONER ACADEMY TO LEGALLY
DEDUCT THE SAME FROM THEIR RESPECTIVE SALARY.[10]

The issue here boils down to whether or not the UNION is


entitled to collect agency fees from non-union members, and if
so, whether an individual written authorization is necessary for
a valid check off.
The collection of agency fees in an amount equivalent to union
dues and fees, from employees who are not union members, is
recognized by Article 248(e) of the Labor Code, thus:

Employees of an appropriate collective bargaining unit who are


not members of the recognized collective bargaining agent
may be assessed reasonable fees equivalent to the dues and
other fees paid by the recognized collective bargaining agent,
if such non-union members accept the benefits under the
collective bargaining agreement. Provided, That the individual
authorization required under Article 241, paragraph (o) of this
Code shall not apply to the non-members of recognized
collective bargaining agent.

When so stipulated in a collective bargaining agreement or


authorized in writing by the employees concerned, the Labor
Code and its Implementing Rules recognize it to be the duty of
the employer to deduct the sum equivalent to the amount of
union dues, as agency fees, from the employees' wages for
direct remittance to the union. The system is referred to as
check off.[11] No requirement of written authorization from
the non-union employees is necessary if the non-union
employees accept the benefits resulting from the CBA.[12]

DEL PILAR admitted its failure to deduct the agency fees from
the salaries of non-union employees, but justifies the non-
deduction by the absence of individual written authorization. It
posits that Article 248(e) is inapplicable considering that its
employees derived no benefits from the CBA. The annual
salary increase of its employee is a benefit mandated by law,
and not derived from the CBA. According to DEL PILAR, the
Department of Education, Culture and Sports (DECS) required
all educational institutions to allocate at least 70% of tuition
fee increases for the salaries and other benefits of teaching
and non-teaching personnel; that even prior to the execution
of the CBA in September 1994, DEL PILAR was already granting
annual salary increases to its employees. Besides, the non-
union employees objected to the deduction; hence, a written
authorization is indispensable to effect a valid check off. DEL
PILAR urges this Court to reverse the CA ruling insofar as it
ordered the deduction of agency fees from the salaries of non-
union employees, arguing that such conclusion proceeds from
a misplaced premise that the salary increase arose from the
CBA.

The argument cannot be sustained.

Contrary to what DEL PILAR wants to portray, the grant of


annual salary increase is not the only provision in the CBA that
benefited the non-union employees. The UNION negotiated for
other benefits, namely, limitations on teaching assignments to
23 hours per week, additional compensation for overload units
or teaching assignments in excess of the 23 hour per week
limit, and payment of longevity pay. It also negotiated for
entitlement to summer vacation leave with pay for two (2)
months for teaching staff who have rendered six (6)
consecutive semesters of service. For the non-teaching
personnel, the UNION worked for their entitlement to fifteen
(15) days leave with pay.[13] These provisions in the CBA
surely benefited the non-union employees, justifying the
collection of, and the UNION’s entitlement to, agency fees.

Accordingly, no requirement of written authorization from the


non-union employees is needed to effect a valid check off.
Article 248(e) makes it explicit that Article 241, paragraph
(o),[14] requiring written authorization is inapplicable to non-
union members, especially in this case where the non-union
employees receive several benefits under the CBA.

As explained by this Court in Holy Cross of Davao College, Inc.


v. Hon. Joaquin[15] viz.:

The employee's acceptance of benefits resulting from a


collective bargaining agreement justifies the deduction of
agency fees from his pay and the union's entitlement thereto.
In this aspect, the legal basis of the union's right to agency
fees is neither contractual nor statutory, but quasi-contractual,
deriving from the established principle that non-union
employees may not unjustly enrich themselves by benefiting
from employment conditions negotiated by the bargaining
union.

By this jurisprudential yardstick, this Court finds that the CA


did not err in upholding the UNION’s right to collect agency
fees.

WHEREFORE, the petition is DENIED. The Decision and


Resolution of the Court of Appeals in CA-G.R. SP No. 86868, are
AFFIRMED.

SO ORDERED.

ANTONIO EDUARDO B. NACHURA

Associate Justice

WE CONCUR:

CONSUELO YNARES-SANTIAGO
Associate Justice

Chairperson

MA. ALICIA AUSTRIA-MARTINEZ

Associate Justice

MINITA V. CHICO-NAZARIO

Associate Justice

RUBEN T. REYES

Associate Justice

ATTESTATION

I attest that the conclusions in the above Decision were


reached in consultation before the case was assigned to the
writer of the opinion of the Court’s Division.
CONSUELO YNARES-SANTIAGO

Associate Justice

Chairperson, Third Division

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution


and the Division Chairperson's Attestation, I certify that the
conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the
opinion of the Court’s Division.

REYNATO S. PUNO

Chief Justice

[1] Penned by Associate Justice Eliezer R. De Los


Santos (deceased), with Associate Justices Eugenio S. Labitoria
(retired) and Arturo D. Brion (now a member of this Court),
concurring; rollo, pp. 33-38.

[2] Id. at 39.

[3] CA rollo, pp. 196-197.

[4] Id. at 128-131.

[5] Id. at 144-146.

[6] Id. at 16-19.


[7] Id. at 20-21.

[8] Rollo, pp. 37-38.

[9] Id. at 39.

[10] Id. at 132.

[11] See Gabriel v. Secretary of Labor and Employment,


384 Phil. 797, 804 (2000).

[12] See Holy Cross of Davao College, Inc. v. Joaquin,


331 Phil. 680, 692 (1996).

[13] CA rollo, pp. 196-197.

[14] Art. 241. RIGHTS AND CONDITIONS OF


MEMBERSHIP IN A LABOR ORGANIZATION.

The following are the rights and conditions of membership in a


labor organization:

xxxx

(o) Other than for mandatory activities under the Code, no


special assessments, attorney’s fees, negotiation fees or any
other extraordinary fees may be checked off from any amount
due to employee without an individual written authorization
duly signed by the employee. The authorization should
specifically state the amount, purpose and beneficiary of the
deduction; x x x.

[15] Supra note 12, at 692.

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